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Week in review for May 11-15, 2020: Drug developers come roaring back in April

After being hit with the major financial market meltdown when the COVID-19 outbreak decimated U.S. capital markets during March and valuations of public biopharmaceutical companies developing new medicines plummeted, it appears that they have put that reversal behind them with a dramatic price surge in April. As a result, the BioWorld Drug Developers index recorded an almost 20% increase to end the period down 11% year-to-date.

COVID-19 developments

The devastating societal and economic effects caused by the ongoing COVID-19 pandemic should sound a warning bell on how ill-prepared we are in our ability to fight lethal infectious diseases for which no effective therapies or vaccines currently exist. Indirectly, the intense public attention on companies that are engaged in developing COVID-19 cures is also spilling over to companies researching to uncover new anti-infectives that will be needed to replace the diminishing arsenal of effective therapies to combat drug-resistant bacteria and fungi. That is certainly evident among public companies in the space, with the BioWorld Infectious Diseases index showing an increasing upward trend since the beginning of the year. At market close on May 11, the index had, in fact, grown in value by a whopping 47%.

The Innovative Medicines Initiative (IMI), a public-private research partnership between the European Commission (EC) and Europe’s pharmaceutical industry, has boosted funding for a fast-track response to the COVID-19 pandemic from €45 million (US$48.8 million) to €72 million. In addition, the eight funded projects will receive a further €45 million through in-kind contributions from EFPIA members and their affiliates or through additional cash contributions. The boost in funding was motivated, the IMI said, by the high quality of the project proposals it received.

The Japanese government is tightening its grip on its listed companies, including those working on promising COVID-19 treatments. On May 8, the Japanese Ministry of Finance released a list of 518 companies that would be subject to stricter restrictions on receiving foreign investments. Starting on June 7, foreign investors buying a stake of 1% or more in Japanese firms will be pre-screened, compared with the previous limit of 10%.

The U.K. is launching a £28 million (US$34.5 million) project to sequence the whole genome of every COVID-19 patient in the country treated in intensive care, with the aim of uncovering host genetic factors that lead some people to be more severely affected by the infection. The study will involve up to 20,000 people currently or previously treated in one of 170 intensive care units (ICUs), whose genomes will be compared to 15,000 people with a confirmed infection who had mild or moderate symptoms.

The U.S. Patent and Trademark Office has opened a priority track for patents related to the COVID-19 pandemic, another signal of federal government intent on overcoming this new plague.

Abivax SA has rejected an acquisition offer in order to pursue a phase IIb/III trial of its lead anti-inflammatory drug, ABX-464, in 1,034 COVID-19 patients. The study will get underway in 50 centers in France and in other European countries in the coming weeks. Acer Therapeutics Inc. has formed a collaboration with the NIH’s National Center for Advancing Translational Sciences to develop emetine hydrochloride as a potential treatment for patients with COVID-19. Avacta Group plc said several Affimer reagents generated for development of a point-of-care COVID-19 antigen saliva test have also been shown to block the interaction between the virus’ spike protein and ACE2, a receptor on human cells that is key to the virus infection pathway. Gryt Health and Bristol Myers Squibb Co. plan to develop the COVID Advocacy Exchange, a virtual platform to promote the exchange of information between patient advocacy organizations, patients, policymakers and health care practitioners. Medicago Inc. said its vaccine candidate for COVID-19 induced a positive antibody response only 10 days after a single dose in mice. Once results from a second boost dose are available, the company said it plans to submit a CTA to Health Canada and an IND to the FDA for human trials. National Research Council of Canada is collaborating with Cansino Biologics Inc. to advance bioprocessing and clinical development of Ad5-nCoV, a vaccine against COVID-19, in Canada. The NIH has started a clinical trial to evaluate whether the malaria drug hydroxychloroquine, given together with the antibiotic azithromycin, can prevent hospitalization and death from COVID-19. The study will enroll about 2,000 adults with confirmed infection with SARS-CoV-2 infections, assigning them to at-home dosing of either the active or a matching placebo-based regimen. A two-drug immunotherapy combination evaluated at Roswell Park Comprehensive Cancer Center for treating cancers is expected to become available to cancer patients with COVID-19 through a clinical trial. The FDA authorized clinical researchers at the center to conduct a study assessing the safety and effectiveness of giving both rintatolimod (branded Ampligen and manufactured by AIM Immunotech Inc.) and interferon alfa.

Clinical trials

The phase III pivotal trial of mavacamten, an oral, allosteric cardiac myosin modulator for treating symptomatic, obstructive hypertrophic cardiomyopathy, from Myokardia Inc. hit its primary and all its secondary endpoints.

Drug approvals

About 15 months after closing its multibillion-dollar acquisition of Loxo Oncology Inc., Eli Lilly and Co. has secured an accelerated FDA approval for the first of the deal's headline assets, the RET kinase inhibitor selpercatinib, now branded as Retevmo. The green light, following a priority review, allows for marketing of the drug as a treatment for three types of tumors – non-small-cell lung cancer, medullary thyroid cancer and other types of thyroid cancers – in patients whose tumors have a rearranged during transfection (RET) alteration. The decision arrived well ahead of an earlier-projected third-quarter decision by the agency. Deciphera Pharmaceuticals Inc.’s kinase inhibitor, ripretinib, won the FDA’s approval as a fourth-line treatment for advanced gastrointestinal stromal tumor, a type of tumor that originates in the gastrointestinal tract, well ahead of its Aug. 13 PDUFA date.

Deals of the week

Aerpio Pharmaceuticals Inc. restructured a licensing deal with Gossamer Bio Inc. for its HIF-1 alpha stabilizer, GB-004. Terms of the amended agreement include a $15 million immediate payment to Aerpio and $90 million in milestone payments related to regulatory approvals and commercial sales. Affibody AB is getting $10 million up front and up to $215.5 million in regulatory and sales milestones from a licensing deal with Inmagene Biopharmaceuticals Co. Ltd., in which the latter firm gains commercial rights to its interleukin-17 inhibitor ABY-035 in China, Hong Kong, Taiwan, Macau and South Korea. Bayer AG and Archerdx Inc. have established a global collaboration for the development and commercialization of a next-generation sequencing (NGS)-based companion diagnostic for Vitrakvi (larotrectinib), indicated for the treatment of adult and pediatric patients with solid tumors that have a neurotrophic tropomyosin receptor kinase (NTRK) gene fusion without a known acquired resistance mutation. Bluebird Bio Inc. and Bristol Myers Squibb Co. amended their agreement for the development and commercialization of CAR T therapies targeting B-cell maturation antigen. BMS will buy out its obligations for future royalties on sales of idecabtagene vicleucel and bb-21217 outside the U.S. for $200 million. Boehringer Ingelheim GmbH acquired Northern Biologics Inc., a wholly owned subsidiary of Northern LP, which focuses on therapeutic antibodies targeting the tumor microenvironment. With the transaction, Boehringer Ingelheim said it is now positioned at the forefront of the stromal biology space, an emerging area in cancer immunology. Dyno Therapeutics Inc., an early stage gene therapy firm applying artificial intelligence to advanced capsid engineering, has entered partnerships with Novartis AG and Sarepta Therapeutics Inc., in ophthalmic indications and muscle diseases, respectively. Navidea Biopharmaceuticals Inc. said it regained European commercialization and distribution rights for Lymphoseek (technetium Tc99m tilmanocept) injection from Norgine BV. The companies mutually agreed to end their existing license agreement from March 2015. Through the transition, Norgine is responsible for the continued commercialization and distribution in Europe for six months.

Financial transactions

Public offerings: ADC Therapeutics SA priced about 12 million shares at $19 each, for gross proceeds of about $232.7 million in an upsized IPO deal. Akebia Therapeutics Inc. said it priced an underwritten public offering of 11 million shares at $12 each, with gross proceeds expected to be $132 million. Axcella Inc. priced its underwritten public offering with gross proceeds are expected to be approximately $52.3 million. Ayala Pharmaceuticals Inc. closed its IPO of 3.66 million shares of common stock at $15 each for gross proceeds of approximately $55 million. Kiromic Biopharma Inc. has filed to raise up to $20 million in an IPO. Kiniksa Pharmaceuticals Ltd. priced its public offering with the proceeds expected to be $73 million. Kura Oncology Inc. closed its underwritten public offering for gross proceeds of approximately $143.9 million. Lantern Pharma Inc. has established terms for its proposed IPO and plans to raise up to $25 million from the sale of 1.6 million shares at a price range of $15 to $17. Legend Biotech Corp. has filed with the SEC to raise up to $100 million in a proposed IPO. Myokardia Inc. priced an underwritten public offering of 5.25 million shares of its common stock at $105 each. Oyster Point Pharma Inc. priced its public offering grossing the company $105 million. Pliant Therapeutics Inc. plans to raise up to $86 million in an IPO, and said Novartis AG has committed to buying an additional $10 million of shares in a private placement. Sutro Biopharma Inc. closed its public offering grossing the company approximately $98 million. Syndax Pharmaceuticals Inc. closed its underwritten public offering for gross proceeds of approximately $115 million. TG Therapeutics Inc. priced its public offering grossing the company $153 million.

Venture funding:Hummingbird Bioscience Pte. Ltd. closed an extended series B funding round of $25 million. Kriya Therapeutics Inc., a startup led by former Axovant Sciences Inc. executive Shankar Ramaswamy, has raised $80 million in series A financing. Quralis Corp. completed a $42 million series A round.

Washington news

The FDA released two new COVID-19 guidances. The first discusses general considerations for pre-investigational new drug application meeting requests and outlines a more efficient process for sponsors to receive agency feedback on their supporting data so they can begin clinical trials as soon as possible. In the second guidance, “COVID-19: Developing Drugs and Biological Products for Treatment or Prevention,” the FDA advises on later-stage trials intended to establish the safety and effectiveness for COVID-19 products. The guidance discusses considerations such as appropriate patient selection and trial design.

Word on the Street: Industry responses to the issues of the week

“Our window of opportunity is closing. If we fail to develop a national coordinated response, based in science, I fear the pandemic will get far worse and be prolonged, causing unprecedented illness and fatalities.”Rick Bright, former director of the Biomedical Advanced Research and Development Authority (BARDA), said at a House subcommittee hearing on the U.S. response to COVID-19

“With her exemplary scientific background, proven federal health policy leadership and track record of driving scientific progress to benefit patients, Michelle is the right person at the right time to lead BIO and the biotech sector into a new future. We welcome her to this new role and are excited to support her efforts to help shape the future of biotechnology.”BIO Chairman Jeremy Levin, CEO of Ovid Therapeutics, on the appointment of Michelle McMurry-Heath who will become the Biotechnology Innovation Organization’s next president and CEO on June 1

“Over the past decade, we have learned that HCM is a genetically related disease of hypercontractility with too many myosin heads engaging action in the cells of the heart. By binding to myosin and normalizing the number of heads in the dynamic state, mavacamten therapy reduces the hypercontractility and impairment of left ventricular compliance characteristic of HCM.”Marc Semigran, Myokardia Inc.’s senior vice president of medical sciences, said on a conference call to discuss positive phase III trial results in hypertrophic cardiomyopathy